Cargill, Inc. Confronts The Rainforest Action Network Advocacy
Cargill, Inc.
Cargill, Inc. is an agribusiness company that was founded in the year 1865 in the state of Iowa by William Wallace Cargill. It is present in 67 countries, employs 160,000 people and is the second largest privately held company in the world. Today it is headquartered in Minneapolis and among its main activities are the production and processing of foods such as grains, oilseeds, animal food nutrition products, meat and poultry products.
Palm Oil Activity
Palm oil extraction is one of the main activities in world agriculture for both food and nonfood applications. Its derivatives are used to make cooking oil, margarine, soaps, plastics, candles, lotions, shampoos, body oils and cleaning products. Its popularity is due to the fact that it is cholesterol-free and is considered a great substitute for hydrogenated oils and has a long shelf life.
Oil Palms mainly grow in countries with a tropical climate. Indonesia and Malaysia alone represent 85% of world production and where 4.5 million people depend on this activity. In the United States, due to a regulation by the FDA (Food and Drug Administration) in 2006, which required the level of trans fat in products sold, several companies chose palm oil as a raw material.
Corporate Social Responsibility
Corporate social responsibility is the voluntary commitment of companies where they see themselves responsible for the people, social groups and environment to which they belong. These social commitments go beyond mere compliance with the law, most stakeholders see them as voluntary commitments, and they affect the decision-making and operations of the entire organization, creating long-term value and contributing significantly to the achievement of lasting competitive advantages.
The Rainforest Action Network
“The Rainforest Action Network” is an NGO founded in 1985 that advocates for environmental causes. In 2007 they started a campaign against the biggest players in agribusiness in the U.S. Specifically against Cargill. RAN claimed that they operated 2 plantations in Indonesia and that these plantations were “actively burning and clearing rainforests, causing conflict with local communities, destroying peatlands and operating in violation of the RSPO’s Principles and Criteria and outside of Indonesian law” (2011).
“The Rainforest Action Network” released a publication and made several protests, trying to get public attention and to pressure Cargill, Inc. to use sustainable palm oil in its products.
Cargill measures after RAN confrontation
Due to all the repercussions caused by the publication and protests, in 2010, Cargill had to speak out. Despite Cargill announcing that it would change its entire production chain to segregated certified palm oils, RAN claimed that this measure, despite being the first part of the solution, was still not enough. In addition, they should demonstrate that their sources are responsible and that their partner Unilever also makes certified segregated palm oil available in their trades with Cargill.
Conclusion
Of the 100 largest economies in the world, half are companies. Some of these large companies have economic, political and social power that can be compared to small nations. In other words, its actions have a highly relevant impact on the entire community where it operates, both for people and for the environment.
Ethical and corporate social responsibility issues will increasingly be topics in vogue. Society is changing at an ever faster pace, and it less and less tolerates irresponsible companies with their products, their customers and their community. Companies that do not look at ethical issues as a priority (CSR included) will no longer find space to exercise their business.
References:
Pearce, J., & Robinson, R. (2014). Strategic Management (14th ed.). McGraw Hill.
Rainforest Action Network. (2011). Cargill’S Problems With Palm Oil. https://www.ran.org/wp-content/uploads/2018/06/cargills_problems_with_palm_oil_low.pdf
Rainforest Action Network. (2020, January 9). Rainforest Action Network — Fighting for People and Planet. https://www.ran.org/
